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Financial Statements
Notes to the Company Financial Statements
For the year to 28 February 2011
A. Accounting Policies of Stobart Group Limited
Respective responsibilities of Directors and Auditors
The separate Financial Statements have been prepared in accordance with
International Financial Reporting Standards (IFRSs and IFRIC interpretations)
as adopted by European Union (“adopted IFRSs”).
The separate Financial Statements are presented in Pounds Sterling (GBP) and
all values are rounded to the nearest thousand (£’000) except where
otherwise stated. The accounting policies that are used in the preparation of
these separate financials statements are consistent with accounting policies
used in the preparation of the consolidated Financial Statements of Stobart
Group Limited as set out in the consolidated Financial Statements. The
Company’s accounting policies are set out in Note 1 of the Group Financial
Statements.
The additional accounting policies that are specific to the separate Financial
Statements of the Company are set out below. The Financial Statements of
the Company are also prepared in accordance with the Companies
(Guernsey) Law 2008.
Judgements, Estimates and Assumptions
The Company makes judgments, estimates and assumptions regarding the
future. Judgments, estimates and assumptions are continually evaluated based
on historical experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances. In the
future, actual experience may differ from these estimates and assumptions.
The judgments, estimates and assumptions that have significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities within
the next financial year are discussed below.
Useful lives of property, plant and equipment:
Property, plant and
equipment are depreciated over their useful lives. Useful lives are based on
the Directors’ estimates of the period that the assets will generate revenue,
which are periodically reviewed for continued appropriateness. Changes to
estimates can result in significant variations in the carrying value and amounts
charged to the income statement in specific periods. More details including
carrying amounts are included in Note I.
Share based payment:
The Company has equity-settled share-based
remuneration schemes for employees and Directors. Employee and Director
services received, and the corresponding increase in equity, are measured by
reference to the fair value of the equity instruments at the date of grant,
excluding the impact of any non-market vesting conditions. The fair value of
share options granted without market based vesting conditions is estimated
by using a Black-Scholes model. The fair value of share options granted with
market based vesting conditions is estimated by using a Monte Carlo model.
These valuations are based on certain assumptions. Those assumptions are
the dividend yield, expected volatility, expected life of the options and the
number of options expected to vest.
Taxation:
The taxation balances are calculatedmaking certain tax assumptions
about the tax treatment of income and costs, and the availability of certain
losses.
Investment in subsidiaries:
Investments in subsidiary undertakings are stated
at cost less any provision for impairment. Where the recoverable amount is
less than the carrying amount, a provision for an impairment is recognised.
Share Based payments:
Where equity-settled share options are awarded to
employees, the fair value of the options at the date of grant is charged to the
income statement over the vesting period. Non-market vesting conditions are
taken into account by adjusting the number of equity instruments expected
to vest at each statement of financial position date so that, ultimately, the
cumulative amount recognised over the vesting period is based on the number
of options that eventually vest. Market vesting conditions are factored into the
fair value of the options granted. As long as all other vesting conditions are
satisfied, a charge is made irrespective of whether the market vesting
conditions are satisfied. The cumulative expense is not adjusted for failure to
achieve a market vesting condition.
The share based payment cost attributable to subsidiaries is added to the cost
of the investment in the relevant subsidiary.
B. Administrative Expenses
2011
2010
£’000
£’000
Other expenses comprise the following:
Management charge to subsidiary companies
(439)
(292)
Other expenses
4,830
4,591
Share based payment
84
190
Auditor remuneration –
Audit of Financial Statements
75
50
Tax consultancy fees
25
7
4,575
4,546
C. Finance Costs
2011
2010
£’000
£’000
Bank loans and loan notes
Interest payable
2,055
813
Income Shares:
Distributions paid
105
422
Amortisation of issue costs
15
29
2,175
1,264
D. Finance Income
2011 2010
£’000 £’000
Finance income comprises the following:
Interest receivable from subsidiary companies 527 393
Bank and other interest 51 20
578 413
E. Taxation
Taxation on profit on ordinary activities 2011 2010
£’000 £’000
Current Tax:
- UK corporation tax - -
- Guernsey tax - -
Total current tax - -
Deferred Tax:
- Origination and reversal of
temporary differences (176) 150
Total deferred tax (176) 150
Total charge in the income statement (176) 150